Question

VSB 3006                                                        _________________________

X3 Extra Credit                                               Last Name, First Name – please print

Service Department Allocation

JME has the following data from his service and production departments –

Service 1 is maintenance, incurs $20,000 of cost, and is driven by square feet

Service 2 is tech support, incurs $15,000 of cost, and is driven by machine hours

Production 1 is Cutting - Production 2 is Finishing

	Provider
User	S1	S2
S1	-	10
S2	20	-
P1	40	45
P2	30	65

Required –

You are to determine how much of the $35,000 will be in each production department (P1 and P2) when they determine their departmental overhead rates. You need to do this under 4 approaches – direct, step (2 ways) and reciprocal. You should round to whole dollars and NOT worry if you are off a very few dollars.

NOTE 1 – bring two hard copies to class

NOTE 2 – By signing and submitting this project you certify that you did not work with any other individual in any fashion in preparation of this work.

Answer 1